Browsing by Subject "Inventory Models"

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Open Access
Analysis of consignment contracts for spare parts inventory systems
(2006) Latifoğlu, Çağrı
We study a Vendor Managed Inventory (VMI) partnership between a manufacturer and a retailer. More specifically, we consider a consignment contract, under which the manufacturer assumes the ownership of the inventory in retailer’s premises until the goods are sold, the retailer pays an annual fee to the manufacturer and the manufacturer pays the retailer backorder penalties. The main motivation of this research is our experience with a capital equipment manufacturer that manages the spare parts (for its systems) inventory of its customers in their stock rooms. We consider three factors that may potentially improve the supply chain efficiency under such a partnership: i-) reduction in inventory ownership costs (per unit holding cost) ii-) reduction in replenishment lead time and iii-) joint replenishment of multiple retailer installations. We consider two cases. In the first case, there are no setup costs; the retailer (before the contract) and the manufacturer (after the contract) both manage the stock following an (S − 1, S) policy. In the second case, there are setup costs; the retailer manages its inventories independently following an (r, Q) policy before the contract, and the manufacturer manages inventories of multiple retailer installations jointly following a (Q, S) policy. Through an extensive numerical study, we investigate the impact of the physical improvements above and the backorder penalties charged by the retailer on the total cost and the efficiency of the supply chain.
Open Access
Modeling the supplier uncertainty with phase-type distributions in inventory problems
(1996) Balcıoğlu, Ahmet Barış
This study considers a stochastic inventory nnodel where the supply availability is subject to random fluctuations. The periods in which the supplier is available (ON) or unavailable (OFF) are modeled as a semi-Markov process. During ON periods the {q,r) policy is applied. During OFF periods, the amount enough to bring the inventory position to q + r is ordered as soon as the supplier becomes available again. The regenerative cycles are identifled by observing the inventory position and using the renewal reward theorem the average cost per time objective function is derived. In our study, a K-stage Phase-Type distribution for ON periods and a general distribution for OFF periods are assumed. In our study, the problem is theoretically solved for Kstage Phase-Type distributions; additionally numerical computations are made for 2-stage Phase-Type distributions. For large q values the structure of the objective function is investigated.